Bad vendors put e-commerce at risk

Smuggled, counterfeit and low-quality products have begun to spread rapidly on e-commerce platforms as the absence of physical product touch in online shopping puts buyers at a disadvantage.

 

Nguyen Duc Le, deputy director of the Professional Affairs Department under the Ministry of Industry and Trade (MoIT), admitted that deceptive trade practices have been rising steadily in recent years.

“Bad vendors use genuine products for advertisements but deliver low-quality or second-hand products to buyers, depriving them of the warranty rights,” he said.

Le Mai Huong, an enthusiastic online shopper in Ha Noi, shared her bad experience when shopping online with Viet Nam News.

“In my experience, shoppers should not buy online stuff sold at prices far lower than market prices, notably cosmetics and drugs, as they are almost fake products. In addition, for clothes and consumer goods, many times I received products with bad quality, contrasting to sellers’ introduction, especially in terms of size, shape and fabrics,” she said.

Deputy Director Le from MoIT revealed that some vendors collude with smugglers to manoeuvre counterfeit products into Viet Nam and then sell them online to earn higher profits.

“Bad vendors are difficult to root out since they have come up with many new tricks to avoid being detected,” he added.

One of the tricks is hiding smuggled products in their own homes. The market management force needs approval from a chairman of the district-level People’s Committee to be able to search the houses.

As approval granting is time-consuming, bad vendors normally have enough time to move the products elsewhere once they sense something wrong, effectively escaping detection.

The deputy director urged e-commerce platforms to handle customer complaints faster and use the complaints to detect bad vendors to eliminate them from online trade.

“Call our hotlines if you notice any illegal trade practice. Your tip-offs will help us a lot in the fight against bad vendors,” he said.

Vo Tri Thanh, head of the Institute for Brand and Competitiveness Strategy, underlined the rise of counterfeit products that hinder firms’ motivation to innovate.

“No firms are willing to grow and innovate in a business environment inundated by counterfeit products. Those products are a serious setback to the target of a wealthy economy,” he said.

Thanh also remarked that the deceptive trade practices would give rise to tax evasion and intellectual rights infringement and hold back the development of a cashless economy. If left unchecked, the damages would be enormous.

“Buyers would switch from payment in advance to cash on delivery should they lack confidence in vendors, holding back non-cash transition,” he said.

Nguyen Dang Sinh, chairman of the Vietnam Association for Anti-Counterfeiting and Brand Protection, forecasts that the number of deceptive cases on e-commerce platforms will exceed 50 per cent of total deceptive cases in trade in the next 2-3 years.

The chairman was concerned that counterfeit products would soon price out genuine products from the market with such rapid growth, suffocating domestic production.

He called on the authorities to step up preventive measures to stop smuggled products from entering the country, keeping deceptive practices in check.

He also revealed that some firms tried to stay silent about their products being counterfeited for fear that media coverage would be more of a hindrance than a help.

"When deceptive cases receive wide media coverage, sales of genuine products begin to plunge as customers become more cautious. Media is a double-edged sword in the fight against counterfeiting," he added.

Vu Anh, strategic director of the e-commerce platform Vo So, admitted that new vendors are emerging in e-commerce platforms so rapidly that quality control and inspection works can not keep up with pace, giving rise to bad vendors.

He suggested stricter legal frameworks to raise the bar on online trade, safeguarding buyers.

"Sellers should be required to pass numerous inspection stages, including tax code checking and know-your-customer checking, before being recognised as vendors on e-commerce platforms," he suggested.

The director also called on the platforms to partner with a third party specialised in origin-tracking and quality control to ease the hard work of inspection.

Nguyen Thi Phuong Thao, manager of the e-commerce platform Tiki, revealed that the platform has been using artificial intelligence (AI) to detect bad vendors in recent years and met with success.

"Thanks to the technology, thousands of bad vendors are removed from our platform every month," she said.

In addition to AI, Tiki has also deployed an internal reputation points system to evaluate its business partners and vendors. Those with inadequate points will be barred from selling their products on the platform.

Online shopper Huong recommended reading other buyers' feedback before making orders and reporting to Shopee any time if getting scammed by bad vendors. 

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